Local government units (LGUs) across the Philippines are set to receive a larger share of national revenues in 2027, with the National Tax Allotment (NTA) projected to reach P1.19 trillion, officials said Wednesday.
Executive Secretary Ralph Recto said the increase—up by P129.32 billion from the previous year—will be among the key items in the proposed 2027 national budget currently being finalized by the Department of Budget and Management (DBM).
Recto described the NTA as a guaranteed share for LGUs, stressing that the funds are treated as entitlements that support frontline services from major cities down to remote barangays.
“As a former local executive official himself, the President sees and honors these as people’s entitlements. These are guaranteed plowbacks that will go from big cities to the remotest barangays,” Recto said.
Under the allocation formula, 83 provinces will share P303.56 billion, 149 cities will receive P303.56 billion, 1,491 municipalities will get P448.84 billion, and 41,912 barangays will be allocated P263.97 billion.
Funding for the NTA will come primarily from Bureau of Internal Revenue (BIR) collections worth P990.68 billion, Bureau of Customs (BOC) revenues amounting to P329.09 billion, and other certified collections from the Bureau of the Treasury (BTr).
Recto said distribution is based on a formula driven largely by population and land area, ensuring what he described as a “non-partisan” allocation of funds.
Among the cities expected to receive the largest shares are Davao City, with P11.23 billion; Quezon City, P10.87 billion; and the City of Manila, P6.74 billion. Also in the top allocations are Zamboanga City, Caloocan, Puerto Princesa, Taguig, Cebu, Antipolo, and General Santos City.
Recto said the expanded LGU funding will be highlighted in President Ferdinand Marcos Jr.’s fifth State of the Nation Address on July 26.
He added that, beyond the NTA, the administration has also increased the Local Government Support Fund (LGSF) to a record P57.87 billion for 2026 to strengthen local service delivery and project implementation.
According to Recto, the government is pushing for closer coordination between national agencies and LGUs, positioning local governments as key partners in implementing national programs, including education infrastructure projects aimed at addressing classroom shortages.
The LGSF is also being used by LGUs to support social welfare initiatives, including the distribution of rice assistance to vulnerable sectors in various communities.